Galaxy Buys Casino to Expand in Macau?s Cotai; Shares Climb
Galaxy Entertainment Group Ltd. (27), the Macau casino owner that doubled profit last year, will buy a casino hotel on the city?s increasingly popular Cotai strip. The company?s stock rose to a record.
Galaxy?advanced?5.9 percent to the highest since its 1991 listing after?saying?it would pay HK$3.25 billion ($419 million) for Grand Waldo which includes a spa, casino and a 320,000 square-foot hotel. The casino inside the hotel is already run by Galaxy, which holds one of Macau?s six gambling licenses.
The reclaimed land that joins the Cotai and Taipa islands in the former Portuguese colony is being built into?Asia?s equivalent of the?Las Vegas Strip. Casino operators from?Sands China Ltd. (1928)?to?Melco Crown Entertainment Ltd (6883). are adding shopping malls, spas and shows to their resorts, competing for casino revenue that Deutsche Bank AG estimated will grow to 44.5 billion this year after the record $38 billion last year.
?The deal will help broaden Galaxy?s portfolio as Galaxy Macau resort on Cotai appeals to the premium mass while Grand Waldo can draw the lower end mass market gamblers,? Grant Govertsen, an analyst at Union Gaming Research, said by phone today. The company?s StarWorld on the Macau peninsula focuses on the high-stakes gamblers, he said.
Grand Waldo is ?strategically located? and it will complement existing Galaxy properties, according to Peter Caveny, vice president of?investor relations?at?Galaxy Entertainment. The property is located next to the Galaxy Macau resort. Galaxy expects the deal to be completed in the third quarter this year, said Caveny.
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Source: Vinicy Chan (2013). Galaxy Buys Casino to Expand in Macau?s Cotai; Shares Climb, Bloomberg?http://www.bloomberg.com/news/2013-05-05/galaxy-to-buy-macau-gambling-resort-grand-waldo-for-419-million.html published May 06, 2013. Viewed May 13, 2013,